Anadarko Says BP's `Reckless Decisions' Led to Spill

Anadarko Petroleum Corp., the Texas oil company that owns 25 percent of the damaged well pouring crude into the Gulf of Mexico, said BP Plc, the well’s operator, should pay the costs from the disaster because of the reckless and unsafe way it drilled at the site.

BP didn’t monitor or react to warning signs as the Macondo well was drilled, Chief Executive Officer Jim Hackett said today in a statement. BP is responsible for damages under such conditions, Anadarko said.

“BP’s behavior and actions likely represent gross negligence or willful misconduct and thus affect the obligations of the parties under the operating agreement,” Hackett said in the statement.

BP said in a statement that it “strongly disagrees” with Anadarko’s position. Chief Executive Officer Tony Hayward said his company expects other parties that may have responsibility for costs and liabilities to meet their obligations.

“These allegations will neither distract the company’s focus on stopping the leak nor alter our commitment to restore the Gulf Coast,” Hayward said in the statement.

The well is gushing as much as 60,000 barrels of oil a day, according to a government estimate. The leak was triggered by an April 20 explosion at a drilling rig leased to BP by Transocean Ltd. Costs of the spill may climb to as much as $50.8 billion if the well is capped at the end of August, according to a June 16 research note from ClearView Energy Partners LLC, a Washington- based policy analysis firm.

Shares Fall

Anadarko, at today’s market close, had plunged 42 percent in New York trading since April 20. Anadarko rose 48 cents in after-hours trading to $43.05. BP’s American depositary receipts dropped 23 cents after-hours to $31.53.

BP’s partners should be held accountable and should set aside money to pay their share, U.S. Representative Edward Markey said today in an interview for Bloomberg Television’s “Political Capital With Al Hunt.”

Mitsui Oil Exploration Co., which is 70 percent-owned by Japan’s second-biggest trading house, Mitsui & Co., has a 10 percent stake in the well. BP owns 65 percent.

Co-owners of the project entered into a written agreement that BP would act as the operator and all parties would share the costs based on their ownership interests, including expenses to clean up any spill resulting from drilling, BP said in its statement.

Rating Cut

The co-owners also filed documents with the U.S. government certifying that each would be “jointly and severally liable” along with any other responsible parties for oil spill removal costs and damages in accordance with the Oil Pollution Act of 1990, according to BP’s statement.

Anadarko will consider what its remedies may be, John Christiansen, an Anadarko spokesman, said today in an interview. Those options may include not paying BP’s bills or litigation. Anadarko previously said it was reviewing an invoice from BP on spill costs.

Hackett said that Anadarko recognizes it has “obligations under federal law related to the oil spill, but will look to BP to continue to pay all legitimate claims as they have repeatedly stated that they will do.”

Also today, Moody’s Investors Service said it downgraded Anadarko’s long-term debt rating to non-investment grade, dropping it to Ba1 from Baa3, with further reductions possible.

Hackett, in a telephone interview today, called the decision by Moody’s “premature and unwarranted.” He said Anadarko has a “strong financial position.”

Increased Risk?

U.S. Representatives Henry Waxman of California and Bart Stupak of Michigan said in a June 14 letter to BP that “time after time, it appears that BP made decisions that increased the risk of a blowout to save the company time or expense.”

If that happened, the lawmakers said, “BP’s carelessness and complacency have inflicted a heavy toll on the Gulf, its inhabitants, and the workers on the rig.”

In a televised address June 15, President Barack Obama vowed he would make BP set aside however much is needed to “compensate the workers and business owners who have been harmed as a result of his company’s recklessness.”

The extent to which BP is seen as “the chief villain of the entire world helps Anadarko,” said Jeff Rensberger, a professor at the South Texas College of Law. A finding of negligence requires a determination that a party to a contract did something a reasonable person wouldn’t, while gross negligence shows more recklessness, he said.

Even if BP is at fault, Rensberger said, Anadarko might still be liable if it’s determined that abnormally hazardous activities occurred at a project in which the company has an interest.

Anadarko also said today that it will donate to Gulf Coast charities or civic agencies any revenue it is entitled to receive from oil recovered in cleanup efforts.

To contact the reporter on this story: Edward Klump in Houston at eklump@bloomberg.net.

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